Iran in Dialogue to Process LNG in Oman: Minister

Iran has started discussion with Oman on using spare capacity of Oman LNG, to process Iranian gas for exports, local media reports said quoting officials.

Addressing the annual media briefing in Muscat, Mohammed bin Hamad Al Rumhy (pictured), minister of oil and gas, said that Oman LNG has a spare capacity of 1.5 million tonnes per annum, which can be used by Iran for liquefying their natural gas.

“That would be the sort of volume we are talking about,” Times of Oman quoted him saying.

Oman LNG has three trains, with a combined capacity of 10.4 million tonnes per annum. Presently, the LNG produced from Oman LNG’s three-train plant facility in Sur is sold to markets in Asia and Europe. Over 1,900 cargoes have been exported from the Sultanate since production began in 2000.

Al Rumhy was also quoted saying that the serious discussion with Iran is for building a 260-km-long natural gas pipeline between the two countries to import natural gas.

“Work is underway for identifying the optimum route. We are making progress. But this kind of projects will take time.”

The proposed pipeline will connect the Iranian province of Hormuzgan to Sohar in Oman.

Iran has signed an agreement to export 10 billion cubic meters of gas per year to Oman in a deal that involves building a pipeline at a cost of about $1 billion. Both countries have signed a memorandum of understanding in 2014 for the sale of Iranian gas to Oman for a 25-year deal valued at around $60 billion, the Times of Oman reported.

Iran sits on the world’s largest gas reserves, according to the latest statistics compiled by BP, but the country was prevented from exporting much of it until the sanctions were lifted recently.

Oman’s natural gas production, which was at 103 million cubic meters per day in 2015, will increase substantially once BP’s Khazzan project starts production and Iran starts pumping gas to the Sultanate, according to the report.